All Empires Collapse
Eventually

by: contributor

All empires
collapse eventually
when they are defeated by a more vigorous empire ... or
when their financing runs out.

Empires are not the result of conscious
thought; they happen when a group is
large enough and powerful enough to
impose itself on others. But empires are
expensive. They are typically financed
by theft and forced tribute. The
imperial power conquers… steals… and
then requires that its subjects pay
“taxes” so that it can protect them.

The US never got the hang of it. It
conquers. But it loses money on each
conquest. How does it sustain itself?
With debt.

It
doesn’t take tribute from the rest of
the world; it borrows from it. As far as
we know, no other empire has ever tried
to finance itself by borrowing. But it
is a special kind of debt. The US
borrows in its own currency – which it
can print as it chooses. If the burden
of repayment is too high, in theory, the
Fed can just print more dollars to
satisfy its obligations.

And we now see the
beginning of the end. America is increasingly viewed as
in relative decline, China is seen as the preeminent
rising power. Even for Gulf Arab states long reliant on
Washington as their ultimate security guarantor, this
makes closer ties to Beijing an imperative strategic
hedge. For Russia, deteriorating relations with the
United States impel deeper cooperation with China,
against what both Moscow and Beijing consider a
declining, yet still dangerously flailing and
over-reactive, America.

Beijing has struck
numerous agreements with Brazil and India that bypass
the dollar. China and Russia have also set up ruble-yuan
swaps pushing America’s currency out of the picture.
They have formed alliances with South Africa to from the
BRICS bank. The economic and gold output of these five
nations surpasses that of the US and the EC combined.

But if Beijing and
Moscow – the world’s largest energy importer and
producer respectively – drop dollar energy pricing,
America’s reserve currency status could unravel. We see
more and more evidence of this. That would undermine the
US Treasury market and seriously complicate Washington’s
ability to finance its vast and still fast-growing
nearly $18 Trillion dollar-denominated debt.

What ultimately
ended the Roman empire was inflation and price controls!
It has been tried in the US before. It didn't work. Will
this be the solution when hyperinflation threatens to
ruin our economy?